Machines and money

Machines and money

Features - Formulas for Success

A fleet of equipment and vehicles that won’t break will save you downtime. Learn some of the best purchasing strategies from these three landscape professionals.

September 19, 2011
Kristen Hampshire

Editor's note: This story was the September cover story. For the digital edition of the magazine, click here.

Downtime is a killer. When equipment is laid up in the shop waiting for maintenance, it's like having an entire crew call in sick.

You scramble to find a "fill in" and take a productivity hit as you realign schedules and cobble together a fast Plan B to get the day's work done.

"In the service business, you can't get that downtime back," says Tim Schnabel, president, Aggieland Green Lawn & Tree Care in Colorado Springs, Colo., and College Station, Texas. "You have to buy the right equipment that gets the job done most efficiently with the fewest headaches and problems."

Buying smart takes some practice, and most of us make mistakes before we figure out the art and science of purchasing. We have preferences for certain lines/brands, and there are numbers to crunch.

But if you're in the buying mode these days, Todd Pugh says equipment dealerships are ripe with promotions. If you have the cash or you can get financing, you can get some pretty good deals," says the founder and CEO of Todd's Enviroscapes in Louisville, Ohio.

This month, Lawn & Landscape spoke with three firms to learn their equipment best practices and winning purchase strategies.


A unified approach

Flexibility is the underlying theme of equipment purchase decisions at Todd's Enviroscapes in Louisville, Ohio. Rather than setting a stringent budget and buying schedule for adding mowers or hand-held equipment to the fleet, Todd Pugh keeps the plan loose.

"We need to be quick to make decisions," says Pugh, founder and CEO of the company he started when he was 14 years old. (He incorporated in 1996.) "In the past, we could sit and actually project and budget our equipment needs – we could say, 'We are going to add three mowing crews and this is how much equipment we will need.'"

Today, Pugh might need to add a couple of crews mid-season. Commercial clients are waiting until last minute to contract work in order to save money. Contract administrators have been laid off. There are national buying groups making decisions. But despite all this, business moves much faster today, Pugh says.

That's why Enviroscapes runs unified fleets – same color mowers, same truck brand, same name on hand-held equipment. "That way, we can create stronger vendor relationships, training time is reduced because the guys are used to the same controls and operations and there is less stocking of parts," Pugh says.

Buying the same lines from the same dealers improves purchasing efficiency. And that means Pugh can make last-minute decisions to support business growth that occurs mid-season, or any time, for that matter.

Of course, equipment purchasing wasn't always so organized at Enviroscapes. Pugh says there is a learning curve, and when he first got into the business he bought any equipment that was a good deal. "I had Isuzu trucks, Chevy trucks, International trucks," he says. "As your business begins to grow, you end up working around your fleet of equipment – 'We need this truck on that job' – because the vehicles are so different. But they were a good deal."

A fleet of disparate mowers and a mishmash of vehicles got Pugh through the early years, until he could begin unifying his fleet. Before, "We were working around dinosaur-type equipment that I was emotionally attached to," he says, recalling his first vehicle: a Ford 3000 tractor and loader with a 10-foot flatbed trailer. "I didn't have my driver's license yet, so I drove that all through town."

Pugh rotates his trucks – there are 65 of them – every seven to 10 years, or every 100,000 to 150,000 miles. He made an arrangement with his dealer to trade in mowers every two or three years. "He is basically setting a guaranteed buy-back price, so you could consider that a lease," Pugh says.

Meanwhile, paying attention to details ensures that Enviroscapes' fleets work hard for the business. Three mechanics work for Pugh, and they handle all mower repair and truck maintenance. (Once the business hit $1 million, Pugh decided to hire the first service technician.) "You need a mechanic when your landscape guys are doing repairs when they should be landscaping," he says.

He switched to synthetic oil in vehicles and equipment, which costs more but requires fewer oil changes – less product, less labor. The company has an on-site fuel station, and employees are responsible for cleaning equipment and vehicles daily and ensuring proper tire pressure.

Equipment is the No. 2 expense after labor at Enviroscapes, so managing the expense is critical to the company's success, Pugh says.

"Equipment is a huge factor in the profitability of the business," he says. "Once you decide on your fleet, you have to be disciplined and stick to your plan."


Primed for productivity

Moving to ride-on spreaders has made a significant impact on technician fatigue, employee retention and overall productivity at Aggieland Green and Integrated Lawn & Tree Care. The labor-saving equipment doesn't completely replace manual spreaders, but it allows a technician to complete three to four times more work in a single day.

"We are fresh at the end of the day, where traditional methods run us ragged," says Tim Schnabel, president of both Aggieland Green in College Station, Texas, and Integrated Lawn & Tree Care in Colorado Springs, Colo. "While ride-on spreaders require more technical skills, having them in the fleet attracts a higher-quality employee that really finds the equipment is a challenge they enjoy."

At about $9,000 per ride-on (Schnabel pays cash), this is not a purchase he makes on a whim. "We look at ratios," he says, noting that overtime hours and the concentration of customers in a given area of town are analyzed. "We look at how well we have grown in that current year, and if those factors push us toward maxing out technicians, then we will add another vehicle."

Generally, Schnabel adds one vehicle per location per year to its fleet. "We are pretty aggressive when it comes to making sure that we have the right vehicle and equipment," Schnabel says. And the company doesn't leave buying decisions to chance. Before purchasing the first ride-on, Schnabel visited with companies that used various types of ride-on spreaders. "We were able to talk to their technicians, and work on the equipment," he says.

He discovered a preference for the zero-turn hydrostatic, ride-on spreaders with more customization options. Since moving to ride-on spreaders, the company has also invested in ride-on aerators. And, Schnabel has also changed up his vehicles by purchasing a 14-foot box truck that is customized with a back-mounted ramp and side doors that open up for loading product by forklift. "We are protected from rain, from theft, from all of the elements," Schnabel says.

Schnabel says over the years he has learned to buy equipment based on efficiency because downtime is futile. In the past, the older trucks technicians once drove required loss productivity and frequent trips back to the shop for repairs. "We always look for equipment that will make us the most money in the long-term," he says.


Accountability rules

Roger Jacobi doesn't buy iron unless there's cash in the bank to pay for it. "We don't want to go into debt to buy a piece of equipment," he says. So he conducts a cost analysis before heading to the dealership. Because the economy in his region has been more buoyant the last several years than other areas of the country, Jacobi hasn't stalled any buying decisions.

But he plans on getting up to 12 years from each truck, and pumps on spray rigs are rebuilt each year to keep them in tip-top shape. "We used to wait until we had a problem with a pump, but in our case, it's easier to rebuild them every year to prevent something from happening in the field," he says, relating how keeping pumps in stock and backup equipment available in case of a breakdown prevents downtime.

What Jacobi stresses at AgriLawn is equipment accountability. All equipment is barcoded and each piece "belongs" to a truck. "We know at any time which truck is missing equipment and every piece is tracked for repair that way," he says.

A white board in the shop notifies managers if there is a problem with any equipment or vehicle. "We work hard to make sure that employees know it's their responsibility to communicate issues," he says, noting that accountability is emphasized at team meetings.

As for purchasing decisions, Jacobi sticks to the same brand equipment so he can minimize the number of parts he stocks. A fleet/facility manager manages all preventive maintenance, and Jacobi's goal is to maximize the life of all equipment and vehicles – and when he does buy, to bring in a few at a time.

Jacobi is careful to consider the long-term before driving any vehicle off the lot. The last time the company purchased three trucks, Jacobi decided to buy diesel models. At the time, diesel cost less at the pump. "Even though we knew we would pay more upfront for the trucks, we figured we would save money fueling up," he says.

"The following year, diesel prices ended up being higher than gasoline, and it has been that way ever since," Jacobi says. "We learned not to be short-sighted when making decisions like that."

It's time for Jacobi to retire some of his 12-year-old vehicles in the fleet. But those trucks won't go to waste. "We'll put some trucks into other uses – such as making an aerator truck out of older trucks," he says.

Being resourceful speaks to accountability. "We make sure any buying decision makes financial sense," he says.